Unfair Trading: Discussion paper

Predatory businesses that build their fortune by relying on unfair tactics are far too common in Australia. While most businesses play by the rules, there are still many businesses that take advantage of the poorest and most vulnerable in our community.

This is not about scams, rogue traders or ‘bad applies’. It is something more subtle, yet also more calculated. These are business models whose very operating premise relies on taking advantage of those unable to effectively protect their own interests in a transaction. These businesses range from credit repair companies and debt negotiators, to ‘car napping’ tow truck drivers and some door-to-door sales.

We are fortunate to have prohibitions against unconscionable and misleading conduct in the Australian Consumer Law. These laws have enabled enforcement action against some very sharp business transactions. However, the courts have set a high bar for establishing unconscionable conduct and the prohibitions have thus far failed to disrupt many unfair business models.

The review of the Australian Consumer Law in 2016 is a key opportunity for the Government to seal the regulatory gaps that allow these unfair business models to thrive.

We have drafted a discussion paper to inform the debate about unconscionable and unfair trading in the lead up to the review. This paper argues that further reform is needed to shut down these unfair business models: a new prohibition against ‘unfair trading’.

Consumer Action Law Centre welcomes feedback from any interested party on the directions outlined in the discussion paper.